Business acquisitions by foreign funds worrying, says tax commissioner
Tax Commissioner Soteris Markides expressed concern on Friday about the phenomenon of acquisitions of businesses in Cyprus by foreign companies and funds.
He told MPs at the House finance committee – discussing the tax reform bill – that Cyprus should be worried about the fact that hotels, universities and hospitals were being bought by foreign business groups.
Referring to the tax reform bill, Markides said stricter anti-abuse provisions had to be enacted, adding that since taxes would be lower for businesses with Cypriot interests, anti-abuse measures could continue to be applied in the same way.
Markides said the current tax system attracted foreign investment but also allowed the acquisition of Cypriot businesses, creating harsh condition for competition.
“We have tried to correct this element,” Markides explained.
The association of certified public accountants objected to the amendments, as did employers’ union Oev, chamber of commerce Keve, the maritime chamber and the banks’ association.
MPs expressed concerns over the provisions of the bill, particularly regarding tax exceptions due to donations to cultural foundations, and asked for the definition of these foundations.
Markides said it might be wiser to add a ceiling to the donations that could be deducted from taxes.